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Structural steel up 21%, five-year fixes at 6%: pricing an extension this autumn
Fabricated structural steel cost 21.2% more in August than a year earlier, and on 5 October the average five-year fixed mortgage reached 6%. Homeowners about to sign for an extension, and the builders pricing it, are dealing with both at once.
Published 18 October 2026
In short
- Construction materials were 6.4% dearer in August than a year before. Steel beams and pipework rose far faster; concrete and timber barely moved.
- Fixed mortgage rates have climbed quickly, so extensions paid for by remortgaging cost more to fund.
- If you have a quote from the summer, ask the builder to recheck it, especially the steel, before you sign.
August’s materials prices
On 7 October the Department for Business and Trade (DBT) published its monthly building materials figures, covering August 2026. Materials across all construction work were 6.4% dearer than a year before, up from 5.9% in July. For repair and maintenance work, which is how the official figures class home extensions and improvements, the rise was 5.9%.
Individual materials moved very differently:
| Material | Used for | Change, Aug 2025 to Aug 2026 |
|---|---|---|
| Fabricated structural steel | Steel beams (RSJs) for knock-throughs and openings | +21.2% |
| Pipes and fittings (rigid) | Drainage and plumbing | +15.5% |
| Concrete reinforcing bars (steel) | Reinforcement in foundations and slabs | +12.5% |
| All construction materials | +6.4% | |
| Repair and maintenance materials | +5.9% | |
| Ready-mixed concrete | Foundations and floor slabs | −0.7% |
| Cement | Mortar, render, site-mixed concrete | −0.8% |
| Imported sawn or planed wood | Roof timbers, stud walls | −1.6% |
Source: DBT, Building materials and components statistics, published 7 October 2026.
Steel has risen most, and import controls are likely part of the reason. Since 1 July, steel brought into the UK above a set quota has paid a 50% duty, and the duty-free quota is about half what it was. Steel sections and reinforcing bar are both covered. Older contracts signed before 14 March were exempt until 30 September, so the August figures may not yet show the full effect.
The Construction Products Association (CPA) expects further rises. Its head of construction research, Rebecca Larkin, said higher oil and energy prices are already feeding into energy-intensive materials, with the risk “clearly on the upside” for further inflation. She said smaller specialist contractors, with less buying power, are particularly exposed if prices rise after a contract has been awarded.
On 8 October the Building Cost Information Service (BCIS) estimated that building costs rose 4.3% in the year to the third quarter of 2026, while tender prices, the prices contractors actually win work at, rose 3.2%. Its chief economist, Dr David Crosthwaite, said: “Contractors are absorbing or mitigating some cost increases to remain competitive.” BCIS expects costs to keep running ahead of tender prices in the near term.
Borrowing costs
Moneyfacts reported on 5 October that the average five-year fixed mortgage had reached 6% for the first time in about three years, with the average two-year fix at 5.98%. At the start of September there were nearly 1,500 fixed deals under 5%. By 5 October there were nine.
On £40,000 borrowed over 25 years, a repayment mortgage at 6% costs about £258 a month, against about £234 at 5%. That is roughly £24 a month more for every £40,000 of building work.
The Bank of England held Bank Rate at 3.75% on 17 September, but three of the nine members of its Monetary Policy Committee voted to raise it to 4%. The next decision is due on 5 November.
The S&P Global UK Construction PMI, a monthly survey of construction firms, was 46.1 for September; anything under 50 means less work than the month before. House building was the weakest part of the industry, which S&P Global linked to rising borrowing costs.
If you are planning an extension
Waiting is unlikely to bring materials prices down. The CPA and BCIS both expect further rises, and borrowing costs are still climbing. The quieter market helps in one way: BCIS says competition for work is keeping tender prices down, so builders may have more availability and price more keenly than they did a year ago.
Before you sign, ask the builder:
- How long is this price valid, and what date are the steel and other supplier prices from?
- Which items are fixed and which are provisional sums, meaning an allowance to be adjusted once the real cost is known?
- Has the steel been priced from the structural engineer’s calculations, or is it a guess? If the engineer hasn’t sized the beams yet, get that done before asking for final prices.
- If a material price rises before it is ordered, how will that be handled? Make sure the answer is written into the contract.
Keep a contingency of 10–15% of the build cost for a straightforward extension, and more on an older house. Hold it yourself, outside the contract price. It covers what turns up once the ground is open or the wall comes down. Material price rises should be dealt with in the contract.
If you are remortgaging or taking a further advance to pay for the work, talk to a broker before you sign with a builder. Rates are moving quickly and lenders can withdraw deals at short notice.
Treat a quote far below the others with care. With costs rising faster than tender prices, a very low price may leave the builder too little margin to finish without coming back for more.
If you are pricing the work
Most domestic quotes are already held for around 30 days, but fabricator quotes for steel are often valid for much less, sometimes only to the date of order. Put the supplier’s quote date and its expiry on your own price, so the client can see where the steel figure came from and when it runs out.
The standard homeowner and minor works contracts are fixed price, with no clause for passing on material rises. If you cannot hold the steel price, show it as a provisional sum or as an item adjusted to the supplier’s invoice, and agree that in writing before the contract is signed. With a homeowner client, a price-change term has to be clear and prominent to be enforceable under consumer law. Raising the price mid-job without one usually ends in an argument over the final account.
Order steel as soon as building control has accepted the calculations and the dimensions are checked on site. If the contract was signed at the client’s home, the 14-day cancellation period applies, and ordering made-to-measure steel inside it needs the client’s written request.
Recheck your preliminaries as well. If steel arrives late or a client is slow to make decisions once work starts, the programme runs long, and scaffold hire, welfare and supervision are all charged by the week.
What it does to an extension price
Steel supply is a modest share of a single-storey extension, usually a few per cent. On a typical knock-through, steel that cost £800 to supply last August would be about £970 at the index rise. Fitting it, padstones, props and fire protection have not risen anywhere near as much, so the whole steel line moves by less than the headline.
Ready-mixed concrete is slightly cheaper, but reinforcement is up 12.5% and drainage pipes and fittings are up 15.5%. Roof timbers have held steady.
The national index for all materials has been rising by around 0.4% a month. On these figures, an extension priced from June supplier rates could be around 1–3% short across the whole job, with most of the gap in steel and pipework. On a £50,000 extension that is £500 to £1,500, which can be most of the margin on a tightly priced job. Recheck the steel and drainage figures before the contract is signed.
Getting a current price
TheGo2Guys prices extensions from drawings at current rates, with steel and other volatile items on separate lines so both builder and client can see what has moved. A full measured estimate for a single-storey extension starts at £150. Homeowners without drawings yet will need an architect or designer, and then a structural engineer, before a full price is possible. Send drawings through the quote form; the fee and delivery date are confirmed within 24 hours.
Sources
- Department for Business and Trade, Building materials and components statistics: September 2026 (August data), 7 October 2026
- GOV.UK, UK’s steel trade measure from 1 July 2026 (updated 1 October 2026)
- Construction Wave, “UK construction braced for ‘delayed’ hike in prices”, 13 October 2026 (comments from Rebecca Larkin, CPA)
- BCIS, Construction Industry Forecast, 8 October 2026
- Moneyfacts, average five-year fixed rate at 6%, 5 October 2026
- Bank of England, Monetary Policy Summary and minutes, 17 September 2026
- PBC Today, “September 2026 PMI shows slowing contraction”, 7 October 2026 (S&P Global UK Construction PMI)
Want a price at this month’s rates?
Send your drawings and every item is priced at current rates, with steel and other volatile materials shown on their own lines. From £150 for a single-storey extension, in 3–5 working days.